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The Best States For Business 2018: North Carolina Leads The Way

November 28, 2018

Kurt Badenhausen | Forbes Staff

The Amazon HQ2 sweepstakes captivated site selection experts and government officials over the past 14 months. The e-commerce giant finally announced plans this month to split the grand prize, with 25,000 jobs headed to both Northern Virginia and Queens, New York. While the 20 HQ2 finalists awaited a decision, many corporate expansions and relocations were put on hold.

The logjam should start to unclog soon, with Apple the next tech titan on the clock. Apple announced plans in January for a major new campus and an additional 20,000 jobs in the U.S. over the next five years. At the time, Apple said a location decision was expected by year-end.

The Raleigh, N.C. metro and its Research Triangle Park is reportedly a leading candidate for the campus (Apple didn’t respond to a request for comment). The Cupertino, Calif. company could do worse for a second home. North Carolina has the best business climate in the U.S. and tops Forbes’ Best States for Business ranking for the second straight year.

North Carolina’s labor, energy and tax costs are all well below the national average and rank as the second lowest in the U.S. overall, per Moody’s Analytics. The 3% corporate tax rate is the lowest in the country.

In addition to low costs, the state boasts a highly educated labor supply fueled by graduates from 53 colleges and universities, including elite schools like Duke University and the University of North Carolina. The outlook is strong as well. Job growth and gross state product growth are expected to rank among the strongest in the country over the next five years. The population is growing twice as fast as the U.S. average.

Raleigh was a finalist for Amazon’s HQ2 ahead of the final announcement, but it was fellow Tar Heel city Charlotte that nabbed a $200 million Amazon distribution center this year. Amazon promises to hire at least 1,500 workers for the state-of-the-art automated facility.

“As a long-established biotechnology hub that attracts the nation’s top talent, Research Triangle Park was an optimal location to expand our footprint and complement our existing state-of-the-art manufacturing site in the Chicagoland area,” said AveXis chief technical officer Andrew Knudten when announcing the news.

International firms are landing in North Carolina too. The state landed Chinese tiremaker Triangle Tyre at the end of last year for its U.S. manufacturing plant. Average annual wages for the 800 jobs will be 70% higher than the existing average in Edgecombe County. State and local incentives of up to $152 million helped grease the wheels.

Forbes has rated the business climates of the 50 states annually since 2006, with only North Carolina (twice), Utah (six times) and Virginia (five times) finishing in the top spot. The 13th version looks at 41 metrics across six main categories: business costs, regulatory environment, economic climate, growth prospects and quality of life. North Carolina was the only state to rank among the top 12 states in all six categories (click here for a detailed methodology).